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Enda Kenny announced today he will step down as Ireland's prime minister after six years once his Fine Gael party elects a new leader.

The governing centre-right party's new leader will be in place by the end of June 2, Kenny said.

Kenny said last year that he would not lead Fine Gael into the next general election, due by 2021 at the latest.

Kenny, 66, is credited with steering Ireland out of its economic collapse, but domestic scandals and a slump at the ballot box saw him come under pressure from within Fine Gael to step aside.

"I will retire as leader of Fine Gael effective from midnight tonight," Kenny said, adding that he would continue as acting party leader until his successor is elected.

"I have asked that the Fine Gael executive council expedite this process and to have it concluded by close of business on Friday June 2."

Kenny said he would give his successor a "brief but appropriate" time to hold talks with parties and independents propping up the minority administration, "regarding provision of government for the future".

Fine Gael lost seats but narrowly remained the largest party after the February 2016 general election as the austerity imposed to turn around the 2010 economic crash grated with growing numbers of voters.

Kenny has faced criticism over his cabinet's handling of a case involving a police whistleblower and the government survived a no-confidence vote in February.

The small opposition Greens called for the new prime minister to be in place by the June 22 gathering of European Union leaders.

Kenny is the longest-serving member of the Dail, the lower house of parliament, having first been elected in 1975. He has led the Fine Gael for 15 years and is its first leader to win re-election to office.

Fine Gael party chairman Martin Heydon described Kenny as a "compassionate, pragmatic and inclusive" leader.

"Having inherited a country and an economy that was decimated by mismanagement, Enda's strong leadership and ability to make hard decisions was recognised both at home and abroad and saw our international reputation restored and strengthened," he said.

The Fine Gael government is propped up by their historic rivals Fianna Fail in a confidence and supply agreement.

Fianna Fail leader Micheal Martin said Kenny had worked diligently for his country over many years.

"While over the years we have had our differences on many political and policy issues, I have always appreciated Enda's decency, good humour and approachability," he said.

Two candidates have so far declared an interest in becoming the next party leader and, by default, the next prime minister for the remainder of what is widely considered to be a fragile government.

Leo Varadkar, 38, may appear an unlikely front-runner in what is still regarded as a socially conservative, relatively homogeneous country.

The Dublin-born son of an Indian immigrant father and Irish mother became the first openly gay cabinet minister, coming out in 2015, and has campaigned on issues such as same-sex marriage and liberalising abortion laws.

The social protection minister was a doctor before winning a seat in 2007 and has rapidly risen through the ranks, holding several ministerial portfolios.

"Enda gave hope to a battered and bruised Ireland in 2011," he said in tribute to Kenny.

"But more importantly he brought this country back from the brink of economic collapse, and offered politically stability when countries across Europe were staring into the abyss."